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Post-Mortem Estate Planning

Estate Planner in Tysons Corner

The death of a family member presents a critical juncture in the estate planning process for the surviving family. While it is too late to change the decedent’s will, there may be other opportunities available to plan for the future and further objectives such as the distribution of assets to family members, supporting charitable activities, or minimizing estate taxes. One of the key post-mortem planning techniques involves the use of qualified disclaimers. A disclaimer is a renunciation of a right to receive some or all assets passing to a person as a result of another’s death. This that can be quite beneficial in the right circumstances. Indeed, many modern estate plans explicitly contemplate disclaimers as a means of achieving flexibility in estate planning. A qualified disclaimer must comply with certain legal requirements to be effective, however, and normally must be formally documented before the assets are moved.

With the recent changes to the federal estate tax laws, surviving spouses must carefully consider whether a federal estate tax return should be filed. Under a feature of the new law called “portability,” a surviving spouse may be able to use a deceased spouse’s unused federal estate tax exemption. To do so, however, a federal estate tax return must be filed, even if no federal estate tax is due. This huge potential estate tax savings can be squandered by failing to take the correct and timely steps. It is therefore absolutely critical that a review and analysis be made upon the death of a spouse to determine whether an estate tax return should be filed. In many cases, it will be important to do so, if only to preserve the option, and the resultant planning flexibility, for the surviving spouse.

Dominion can advise clients on these and other post-mortem estate planning issues.